Managing Intellectual Property (IP) Through an EOR? Here’s What You Need to Know

Intellectual property (IP) is a critical asset for many businesses. Whether it’s patents, trademarks, copyrights, or trade secrets, protecting your IP is essential to maintaining a competitive edge. 

Today, many companies are turning to Employers of Record (EORs) to manage international talent and mitigate compliance risks. However, there are certain aspects you must be careful of when allowing an EOR to manage the IP for your business.

Here are some interesting facts you might like to learn about IP management –

• Every country has its own IP laws, which means a patent, trademark, or copyright in one country does not automatically extend to another. Businesses must apply for IP protection in each country where they want to protect their assets.
• The Madrid Protocol allows businesses to register trademarks in multiple countries through a single application. 
• The Patent Cooperation Treaty (PCT) is an international treaty that allows inventors to seek patent protection in multiple countries through a single application. This streamlines the process, but the final patent grant still depends on the laws of each individual country.
• Even with international protection, enforcing IP rights can be challenging. Counterfeit goods, for example, are a significant issue, particularly in countries with less stringent IP enforcement.
• Many companies use IP licensing to expand into international markets, which allows them to partner with local firms, leveraging their IP while navigating the nuances of foreign markets.

Top 9 Things to Consider When Managing IP through an EOR

Read on to understand!

1. Explicit IP Ownership Clauses

One of the most important steps is to include explicit IP ownership clauses in all contracts with the EOR and the employees they manage. 

These clauses should clearly state that any IP developed by the employee during their tenure belongs to your company. For example, if you hire a software developer through an EOR, your contract should explicitly state that any code they write while employed by your company is your company’s property.

It can prevent future disputes and ensure your company retains controver its intellectual assets.

2. Verify EOR’s IP Policies

Understanding how an EOR handles IP issues can help you gauge their reliability and efficacy in safeguarding your interests.

Therefore, before signing an agreement with an EOR, ask for their written policies on IP management. Review these documents to ensure they require their employees to assign all rights to the IP created during their employment to the client company (your company). 

3. Jurisdictional IP Laws

It’s critical to understand that IP laws differ across jurisdictions. What is protected under U.S. law might not be safeguarded under European or Asian legislation, for instance. Also, in some countries, employees automatically own the IP they create unless otherwise stated in a contract.

So, collaborate with your legal team to ensure compliance with the IP laws of the jurisdictions where your EOR operates. This is especially important for multinational operations where multiple legal systems come into play.

4. Confidentiality Agreements

Ensure that all employees managed by the EOR sign comprehensive confidentiality agreements. 

These agreements should clearly state that all proprietary information and developed IP are to be kept confidential, with stipulations that continue even after the employee leaves.

So, your hired graphic designer through an EOR should sign a confidentiality agreement that prohibits them from sharing or using any proprietary design files and materials outside of your company, both during and after their employment.

5. Process for Documenting and Transferring IP

Establish clear processes for documenting and transferring any IP created by employees. This might include regular updates, documentation practices, and report submissions that capture the development stages of a given IP. 

6. Involve Legal Counsel

Navigating the intricacies of IP law can be challenging, especially when managing it through an EOR. 

That’s why, before finalizing any contract with an EOR, have your legal team review the document to ensure that all IP-related clauses and obligations are thoroughly covered and legally sound. They can identify potential risks and provide guidance on best practices to ensure long-term protection of your IP.

7. Regular Communication

Maintaining regular communication with both the EOR and the employees is inevitable. This helps to reinforce the importance of IP protection and ensures that everyone involved is aware of their responsibilities. 

Regular check-ins can also help to identify any potential issues early, allowing for timely intervention. 

Hold quarterly meetings with the EOR and the employees they manage to revisit IP policies, discuss any concerns, and ensure everyone understands their responsibilities regarding IP protection.

8. Audit and Compliance Checks

Conduct periodic audits to ensure that the EOR and its managed employees are adhering to agreed-upon IP policies. Track compliance through internal emails or a project management tool like Trello. 

It can reveal gaps in practices that might otherwise go unnoticed and can help in fine-tuning policies to better protect your IP.

9. Employee Education and Awareness

Educate employees about the importance of IP and the specific processes your company has in place to protect it. Awareness campaigns, training sessions, and regular updates can go a long way in ensuring everyone understands the value of IP and adheres to best practices.

For example, you could organize an annual workshop for all remote employees through the EOR, educating them on the importance of IP protection, relevant legal concerns, and specific practices they need to follow within your company.

Strike Out the Complexities With Tarmack!

At Tarmack, we understand that managing intellectual property is one of the most critical aspects of running a successful global business. Our EOR services not only streamline the hiring process but also offer comprehensive IP management support. 

Tarmack has you covered, from ensuring clear IP ownership and navigating international laws to safeguarding your data and developing strong policies.

With us, you can rest assured that your intellectual property is handled efficiently. If you’re looking to expand your team while keeping your IP secure, Tarmack’s EOR services are the way to go! Contact us today to learn more.